|Question And Answer|
|Answered by:||Advocate Shashi Ashok Bekal|
|Date:||April 29, 2023|
During the course of assessment proceedings, AO notice that in some loan transcation assessee has accepted loan in Cash and assessee has also given confirmation from the lender that he is assesssed to tax and disclosed the transcation in his books of accounts. Assessment U/Sec. 143(3) was completed on 31.03.22 by accepting Returned income. There is no mentioned about contravention of provisions of Sec. 269SS of the Act.
On 10.05.2022, he made a reference to Joint CIT about contravention ofprovisions of sec. 269SS and initiation of penalty proceedings u/Sec. 271D of the Act. The JCIT o 10.06.22 initiated penalty proceedings and sent a show case notice asking the assessee as to why penalty should not be levied for contravention of provisions of Sec.269SS.
Assessee has replied that since the AO has made reference to JCIT for initiation of penalty proceedings U/sec. 271Dafter completion of assessment proceedings , penalty proceedings initiated by JCIT is bad in law.
Whether assessee view is correct ? If yes, are there any judicial support for this contention.
The view is not correct. Penalty proceedings under section 271D of the Act are independent of assessment proceedings. The issue will have to be dealt with on merits.